The client was retiring from LMCO after a successful 30+ year career and sought the best pension payout strategy to maximize benefits for him and his spouse.
To consider the higher life-only insurance payout, the risk of the husband passing prematurely needed to be mitigated. Utilizing a brief health questionnaire, we contacted three life insurance underwriters to see who would provide the best option for our client. Then, after determining the carrier that would provide the best underwriting, we helped design life insurance coverage in which the premiums were less than the after-tax take-home pay differential between life-only and joint 100% survivor.
Once the 10-year policy premium expires, the client will have a “take-home pay increase” from no longer paying premiums due to no longer needing life insurance protection. The strategy lets the couple benefit from over $60,000 a year of income and insured death benefits for the children once both spouses pass.
